The World Bank Group has launched a $6 billion insurance-backed facility to expand lending to micro, small, and medium-sized enterprises (MSMEs) in emerging markets, supporting job creation and private sector growth. Through this initiative, participating insurers share credit risk on a portion of eligible loans made by IFC, the World Bank Group’s private sector arm, freeing up capital to enable IFC to lend more to commercial banks and financial institutions. The facility is expected to support up to $10 billion in new IFC lending, targeting businesses that account for over 90 percent of all firms and approximately 70 percent of total employment in these markets.
IFC’s $6 billion commitment under this facility represents its largest mobilization under a single agreement and one of the largest credit insurance arrangements by a multilateral development institution. The program is backed by a consortium of 19 global insurance companies, including AIG, Allianz Trade, Arch Insurance International, AXA XL, Chubb, Munich Re, Swiss Re, and others. By participating, insurers benefit from IFC’s due diligence and streamlined deal origination process, allowing them to efficiently support projects even in regions where they have limited market experience, thereby channeling more private capital into development initiatives.
This facility is part of IFC’s broader Managed Co-Lending Portfolio Program (MCPP) for credit insurers, which has expanded since 2017 from a $1 billion initiative with two insurers to a $25.5 billion platform mobilizing private capital for emerging markets, including fragile and conflict-affected countries. The program has facilitated $15.5 billion in credit insurance mobilization across five transactions, reinforcing IFC’s mission to expand access to finance and promote financial resilience.
Global insurers participating in the program emphasized the benefits of partnership with IFC, noting that the initiative enables them to support sustainable economic growth, strengthen local financial systems, and provide long-term stability to MSMEs. They highlighted the program’s scalable structure and portfolio-based approach, which allows efficient deployment of capital while reducing costs and delays typically associated with evaluating individual projects in emerging markets.
Through this facility, IFC aims to address critical financing gaps for MSMEs, promote economic growth, and enhance financial inclusion across Southeast Asia, Africa, Latin America, and other emerging markets. The program illustrates the potential of public-private collaboration to mobilize significant resources and create impactful development outcomes for private sector growth.
IFC, as the largest global development institution focused on the private sector in emerging markets, operates in over 100 countries, leveraging capital, expertise, and influence to create opportunities in developing economies. In fiscal year 2025, IFC committed a record $71.7 billion to private companies and financial institutions, advancing sustainable development and poverty reduction while mobilizing private investment.
